I’ve mentioned before, first day initial public offerings are favorite trading candidates for me. There’s no resistance above the highs they make, and they often provide clean trading patterns.

Today, CSUN - China Sunergy was one of those IPO’s that traded a pattern I’d like to find every day.

Using a 15-minute chart cuts out some of the noise. There’s a combination buy signal on the eighth candlestick. You’ve got a NR7, and a classic buying pattern. Risk - R is less than a dime here, which is excellent reward/risk. Aggressive traders would place a stop under the seventh candlestick. Conservative online trading would dictate placing the stop under the day’s low. CSUN was pretty non-stop from that first entry point.

I’ve written before how the 50 dma acts as a magnet. Yesterday, I mentioned that GOOG - Google Inc. had gone under that technical indicator. This online trader saw that as only a warning sign. Today, GOOG traded right back to this important moving average. When it moved back above it, the short squeeze was on.

The stock paused for 15 minutes before shooting higher over the 50dma. During options week, I’ll expect higher, or odd volatility. We had that here. Note that the break of the downtrend coincided with the 50dma breakout.